Online Display Advertising India

December 2009

Research conducted by:

Research conducted for:

TABLE OF CONTENTS
1.0 EXECUTIVE SUMMARY 2.0 RESEARCH METHODOLOGY 3.0 ONLINE ADVERTISING MARKET IN INDIA 3.1 MARKET SIZE 3.2 QUARTERLY DISTRIBUTION OF REVENUES 3.3 BREAK UP OF MARKET BY VERTICALS 3.4 GROWTH IN VALUE OF VARIOUS VERTICALS 4.0 GLOBAL ADVANCEMENTS IN ONLINE DISPLAY ADVERTISING 4.1 GLOBAL ONLINE DISPLAY ADVERTISING MARKET SIZE 4.2 IAB GUIDELINES FOR GAUGING PERFORMANCE OF DISPLAY ADVERTISEMENT 5.0 UNDERSTANDING AN INTERNET USER 5.1 DEMOGRAPHIC DISTRIBUTION OF USERS 5.2 ONLINE ADVERTISEMENT FOR DIFFERENT PRODUCT CATEGORIES 5.3 SEARCHED FOR INFORMATION AFTER WATCHING THE ADVERTISEMENT 5.4 PRODUCT PURCHASED 5.5 CONVERSION FROM VISIBILITY TO PURCHASE OF ONLINE ADVERTISEMENTS 5.6 PROBLEM SEEN BY INTERNET USERS IN ONLINE ADVERTISEMENTS 6.0 ONLINE ADVERTISING IN SME 6.1 AWARENESS AND USAGE OF ONLINE ADVERTISEMENTS AMONGST SMES 6.2 BARRIERS FOR USING ONLINE ADVERTISEMENTS AMONGST SMES 7.0 EMERGING TRENDS IN ONLINE DISPLAY ADVERTISING MARKET 7.1 PERFORMANCE BASED ONLINE DISPLAY ADVERTISEMENTS 7.2 INTEGRATING INTERNET ADVERTISING IN MARKETING CAMPAIGNS 7.3 IMMERSIVE FORMATS FOR INTERNET ADVERTISING 8.0 ENDNOTE 2 4 6 7 8 9 10 11 12 12 13 15 16 17 18 19 20 21 22 23 24 25 25 26 26 28

1.0 Executive Summary

As media vehicles continue to fragment and mesh within each other, marketers need to understand the implication of various parameters guiding this fragmentation basis the consumer behavior. The challenge for a marketer is to have a deeper understanding of every media vehicle so that they can selectively target right customers for their message delivery. Internet has opened up a lot of opportunities for marketers for targeting customers in interactive and measurable ways. Online advertising helps to target specific customer segments and gather information across geographical boundaries in a cost effective manner. Online advertising helps in not only leading visitor to a publishers site but also creating awareness which potentially could result in gradual brand building. This report aims to map the size of online display advertising in India. The report charts detailed behavior of Internet users and small-medium enterprises in the online display advertising market in India. The report is based on an extensive research conducted by IMRB International and supported with industry feedback. Findings of the report show that size of the online display advertising market has reached INR 3250 Million for FY 2008-09 registering a significant growth rate of 38% and is expected to surge at INR 4300 Million for FY 2009-10. The study reveals the fact that online publishers (26%) remain major contributors of this market while there is a sharp decline in the contribution of the BFSI sector (25% to 17%) this year. In addition, FMCG sector and mobile handset manufacturers have adopted this form of advertising as an effective tool to target Internet users in the age group of 18-24 years, who are the growth drivers of the Internet in India. Online display advertisement has consistently formed a sizeable portion of overall online advertisement market. It has continued to be an effective long-term option for digital marketers in targeting customers with specific characteristics. Although the share of other options such as search engine marketing may assume larger proportions over
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time, display advertisement will continue to command a substantial part of this spending. Recent financial debacle in the US and its ripple effect on the Indian economy has resulted in differences in the market dynamics compared with previous years. However, increase in the Internet user base, extensive usage of Internet by political parties for elections and usage of Internet for advertising by SMEs are the factors strongly supporting for sustained growth of online display advertising market in India.

2.0 Research Methodology

The research team at eTech Group | IMRB, a specialist unit of IMRB International adopted a mix of primary as well as secondary research for this report. Given below is the research methodology used for the report:

In-depth discussions with the key players in the online display advertising industry Detailed questionnaire was designed to get insights on the market size of online display advertising industry

Relevant data points were culled out from I-CUBE 2008 reports, an annual syndication of eTechnology group, IMRB International This is based upon primary survey covering 20,000 Households, 90,000 individuals, 1000 SMEs and 500 cyber cafes

Secondary research was done using information from various published resources and other research bodies to triangulate with our findings

3.0 Online Advertising Market in India

Figure 1: Growth in the Active Internet User Base in India
(All figures are in Million. Source: I-Cube2008, Annual IMRB Syndication) 57 ((All figures are in Millions. Source: I-Cube2008, Annual 50 IMRB Syndication) 46 42 )

36 32.2 21.1 16.4 8.7 4.9 2.2 4.3 11.9 7.5 11.2 5.5 3.3 32

2000

2001

2003

2004

2006

2007

Mar-2008 Sept-2008 (Est.)

Mar-2008 Rural

Claimed Internet User

Active Internet User

The graph above illustrates the growth in Internet user population in India over the years. The Internet penetration findings are based on I-Cube 20081 which is an annual research syndication conducted by IMRB International. India has witnessed continuous growth in the Internet adoption in certain sections of society - predominant patterns exist mostly in urban areas. Across all urban areas, there has been an increase in the number of Claimed2 as well as Active3 Internet users. Further with increased penetration in less affluent classes of the society, Internet has started to reach the bottom of the pyramid.

Internet in India (I-Cube) reports are based on a primary survey conducted across 30 cities - among 20,000 Households, 90,000 individuals, 1000 SMEs and 500 Cyber Cafes. To extend the scope of this study, we have carried out this research across 100 rural centers to understand Internet behaviour in rural areas.
2

Claimed Internet User is an individual who has used the Internet at any point in time in past. This gives us a clear indication as to how many Indians have experienced Internet at least once in their lifetime.
3

Active Internet User is an individual who has used the Internet at least once in the last 1 month.

With nearly 0.6% of penetration in the total population, there are 3.3 Mn Active Internet users in rural India. Non-Government Organizations (NGOs), GOI initiatives, community service centers and CSR activities by private companies have played a significant role in ensuring this penetration.

3.1 Market Size

The below figure illustrates the growth of online display advertising market in India. In the financial year 2007-08, the size of this industry was at INR 2350 Million. During the year 2008-09, the industry grew at a high rate of 38% reaching INR 3250 Million. Based on the primary research conducted in this study, it is expected that the industry will grow at a lower rate at 32% and will grow to INR 4300 Million.
Figure 2: Online Display Advertising Market (INR Million)
38%

2350

3250

4300

32%

FY 2007-08

FY 2008-09

FY 2009-10

The ad spent per user, shown in Figure 3, is a function of the total display advertising market and the Internet user base in India. The online display advertising spent per user in India is INR.65 which is very less compared to the other developed countries. Understanding the impact of economic downturn and it effect on budget allocation for marketing activities, online Ad spends per user is expected to increase marginally to INR.68 for the next year.

Figure 3: Ad Spent per User (INR)

(Conversion: 1 USD = 50 INR)

65

68

2008-09

2009-2010

3.2 Quarterly Distribution of Revenues

Distribution of revenues across the year in various quarters follow a particular trend with maximum revenues recorded for first and third quarters of the financial year 2008-09. The growth in the first quarter was largely influenced by continued growth in the past years. With the skepticism of the economic downturn, online advertisement spends reduced in the second quarter. In the third quarter, due to holiday season and festivals online expenditure grew to 27%. There seems to be an overall reduction in marketing spends in the last quarter. However, some sectors such as telecommunication and automobile seem to have regained their momentum.
Figure 4: Quarterly Distribution of Revenues
April to June

26% 23% 24% 27%

January To March July to September

October to December

3.3 Break up of Market by Verticals

Figure 5: Industry Breakup of Online Display Advertising Spends

2008-09

2009-10

(Market Size INR 3250 Million)

2% 4% 4% 17% BFSI Auto 9% FMC G C onsumer Durables IT / Telecom Education 10% Online publishers Electronic Media Print Media 6% 15% 8% Others

(Market Size INR 4300 Million)

4% 2% 2% 15%

25%

9%

26%

11% 8% 16% 8%

The figure above shows the percentage distribution of different industry verticals contributing to the online advertising market. With the recession in the US economy and its global effect, there is a sharp decline in the contribution from the BFSI sector to the market and is expected to decline further in the year 2009-10. This decline pertains to foreign banks that have operations in India and extensively use online medium for targeting HNIs and businessmen. Online publishers are the major contributors to online advertising market with 26% of the revenue from this industry vertical. This is attributed to the available platform as well as easy accessibility to the target audience, which in turn, helps them to become key influencer. Their share is expected to remain static or decline in smaller percentage in upcoming year. Online spending by political parties, general merchandise companies and real estate players which are categorized as Others formed 4% of online marketing spend in the financial year 2008-09. These expenditures are expected to fall to 2% in the next financial year.
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3.4 Growth in Value of Various Verticals

The graph below shows the value in INR Million and growth of the various verticals in the online display advertising market. Of these industry verticals, Education and Print media are expected to grow at the rate of 76%. There is a sharp decline witnessed in the online
advertising spend from BFSI sector because of financial debacle over the last year.

Following this, automobile sector is expected to show the second highest growth rate (46%) with increase in the product launches and emergence of Internet as the effective medium to target youth who constitutes the major chunk of Internet user base in India. With lot of information available online and introductions of the websites where you can
Figure 6: Growth in Online Advertising in INR Million (FY 2008-09 and FY 2009-10)
76% 76%

40%

46% 32%

41% 27% 32%

17%

553

645

387

473

344

488

688

276

325

344

845

1075

260

195

130

172

130

-31%

49

86

B FSI

A uto

FM CG

Co nsumer Durables

IT / Teleco m

Educatio n

Online publishers

Electro nic M edia

P rint M edia

Others

FY 2008-09

FY 2009-10

% Growth

compare the features, prices of various vehicles it offers great help to the prospects for taking purchase decision.

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90

4.0 Global Advancements in Online Display Advertising

4.1 Global Online Display Advertising Market Size

Based on the reports published by Internet Advertising Board (IAB), the aggregate online advertising revenue in the US has reached INR 1172 Billion in the year 2008. This revenue has been growing exponentially in past years. However, due to recent downturn the growth has been a little lower. Of this aggregate revenue, online display advertising comprising banner ads, sponsorship links, rich media and digital video amount to 32% (or INR 375 Billion). On the other hand, search advertising commands 45% of this share. The latest estimates for Europe market has not been made available by IAB yet. The previous reports have indicated that the European market stands at INR 872 Billion for the year 2007.
Figure 7: Aggregate Online Ad Revenue Europe and USA (INR Billions)

1131 900 562 872

1172

2006

2007

2008

USA

Europe

Source: IAB Internet Advertising Revenue Report March 2009 & IAB Europe AdEx 2007

Figure 8 below, illustrates the Online spends per user in developed countries like USA is INR 7165 of which INR 2293 is spent on online display advertising per user (i.e. 32% of the Total Online Advertising Spend). This is far higher than the online display advertising spent in India which stands at INR 65. The online display advertising spend per user in India is still lower compared to other European countries.
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Figure 8: Online Ad Spends per user across various countries

(INR)
10380 9415 8535 7165 6265 5930

5065 3835 3290 2975 2890 2875

Norw ay

UK

Denmark

USA

Sw eden Germany Netherlands Belgium

Finland

France

Austria

Italy

Source: IAB Europe Ad Ex 2007/PWC

4.2 IAB guidelines for gauging performance of Display Advertisement

As witnessed earlier, there are numerous forms of online display advertisements that can be used to convey messages by marketers. The consequence or users reactions on these advertisements are not completely known. Continuously, standards are being devised as well as initiatives undertaken to arrive at the most appropriate method of measuring the performance of various forms of digital advertisements. Interactive Advertising Bureau (IAB) (http://www.iab.net), which comprises media and technology companies, shares best practices and charts measurement guidelines. The bureau is focused on including participants from the US and Europe. It is expected that the guidelines charted out by the bureau can be utilized in Indian markets to gather an in-depth understanding of online display advertisements. Based on the evolution of online advertisements, IAB has charted out guidelines for different types of impressions displayed to an Internet user. These guidelines are exhaustive and include search, display as well as interactive rich advertisement displays.

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The most dominant forms of measuring effectiveness of an online advertisement have been the formulation of a price on click or viewing of it, illustrated in Figure 9 below.

Figure 9: Various Performance Measures

To be exhaustive in measuring performance of any medium, it is imperative to evaluate the reach as well as effect criteria or in simpler terms, look for forest as well as count the trees. Using reach criterion, the extent of online advertisements can be examined while through effect criterion; users reaction post witnessing an online advertisement can be discerned. In its latest release, IAB has proposed guidelines for audience reach measurement as well as through rich applications which are the emerging options for online display advertisement.

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5.0 Understanding an Internet User

The effectiveness of the online advertising is based upon targeting the right customers in a cost effective way. Today, most of the websites are loaded with different forms of advertisements to enable advertisers for conveying their message regarding their products/services. I-Cube 2008, annual syndicated study for tracking Internet usage characteristics in the country, examines the orientation of users towards online advertising. Internet users in their online purchase decision get influenced by their exposure to various kinds of online display advertisements. This section charts out the product purchase behaviour of a user post visibility of online advertisement to the final product purchase.
Figure 10: Recall of Different Types of Online Advertisements

Banners Streaming videos Sponsored links Flash videos Pop-ups

50%

29%

23%

23%

23%

Base: 1.8 Mn Active Internet users who have clicked on online Advertisements (Source: I-Cube 2008, Annual IMRB Syndication)

Of the different types on online display advertising, online banners record the highest recall of 50%. 29% of the 1.8 Mn Active Internet users were able to recall streaming videos which they had seen in past. With improvement in the infrastructure and reduction in the hardware prices there is higher possibility of using streaming videos as an effective method for online advertisement. The lowest recall percentages (23%) are

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for pop-ups, flash videos and sponsored links. While sponsored links are not apparent on a website, pop-ups and flash videos are often blocked by browsers.

5.1 Demographic Distribution of Users

Growth of Internet in India is predominantly driven by youth i.e. users in the age group of 18-35 years. With higher adaptability to the technological changes, users in this age group are using different applications available on the Internet. As witnessed in the following graph, College Going Kids and Young Men form 60% of users who have clicked on online advertisements followed by older men and school going kids.

Figure 11: Demographic Distribution of Users who have clicked on an Online Display Advertisement
3% 10% School Going Kids College Going Student 19% 30% Young Men Older Men Working Women Non-w orking Women 30%

8%

1.8 Mn Active Internet Users who have clicked on online display advertisement (I-Cube 2008, Annual IMRB Syndication)

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5.2 Online Advertisement for Different Product Categories

Base: 1.8 Mn Active Internet users who have clicked on online advertisements

Online advertisement for different product categories

Percentages

Mobile Phone/Instruments Ads for Loans by Banks/Financial Entertainment Sites Ads for Job Sites Investment options like Mutual Funds Education/Training related Computer/Laptop/Printer/Scanner Air Tickets Ads Personal Products Insurance Ads Hotels & Holiday Tours/Packages Automobile Ads Matrimonial Advertisements

58% 50% 42% 40% 39% 37% 38% 35% 28% 28% 25% 23% 20%
(Source: I-Cube2008, Annual IMRB Syndication)

The above table shows the list of categories for which display ads were clicked by the Internet users. Category of ads related to mobile phones and devices are most frequently clicked by active Internet users. As youth in the age group of 18-35 years form a substantial proportion of Internet users, advertising such devices over the Internet is a viable option. This is followed by advertisements for financial products, travel and automobile. Further, with the increase in the popularity of online portals for travel, entertainment and jobs there is significant proportion of visibility seen for advertisements from this area of operations.

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5.3 Searched for Information after Watching the Advertisement

Base: 1.8 Mn Active Internet users who have clicked on online advertisements

Information Searched

Percentages

Investment options like Mutual Funds Ads for Job Sites Mobile Phone/Instruments Education/Training related Entertainment Sites Air Tickets Ads Computer/Laptop/Printer/Scanner Personal Products Ads for Loans by Banks/Financial Automobile Ads Insurance Ads

13% 8% 6% 6% 4% 3% 3% 3% 1% 1% 1%
(Source: I-Cube2008, Annual IMRB Syndication)

Online advertisements play an important role in generating awareness as well as building branding among users regarding different product categories. Maximum number of users searched for information for the product like mutual funds after witnessing online advertisements. Online advertisements related to the job sites as well as mobile phone/instrument have high rate of persuasiveness. In contrast, online advertisements for products like matrimonial and tour packages seem to have the least influencing power leading to the lowest information search.

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5.4 Product Purchased

Base: 1.8 Mn Active Internet users who have clicked on online advertisements

Products Purchased

Percentages

Investment options like Mutual Funds Air Tickets Ads Education/Training related Ads for Job Sites Mobile Phone/Instruments Personal Products Ads for Loans by Banks/Financial Automobile Ads Insurance Ads Computer/Laptop/Printer/Scanner Entertainment Sites

38% 18% 15% 12% 7% 5% 3% 2% 2% 2% 1%

(Source: I-Cube2008, Annual IMRB Syndication)

The above table shows the number of Active Internet users who have purchased product after clicking on the Online Display Advertising. Across all product categories, investment options like Mutual Funds have recorded the highest online purchase after clicking on the online advertisement. This could be due to the online banking facilities like online trading, online banking facilities offered by financial institutions. Convenience and higher discounts act as major drivers for higher purchase of air tickets using online travel sites. Online display advertisements related to matrimonial seems to generate almost none or minimal impact in enticing Internet users to look for information or buy products.

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5.5 Conversion from Visibility to Purchase of Online Advertisements

Base: 1.8 Mn Active Internet users who have clicked on online advertisements

Product Categories

Clicked Online Ads

Searched for Information

Product Bought

Mobile Phone/Instruments Ads for Loans by Banks/Financial Entertainment Sites Ads for Job Sites Investment options like Mutual Funds Computer/Laptop/Printer/Scanner Education/Training related Air Tickets Ads Personal Products Insurance Ads

58% 50% 41% 40% 39% 37% 37% 35% 28% 28%

6% 1% 4% 8% 13% 3% 6% 3% 3% 1%

7% 3% 1% 12% 38% 2% 15% 18% 5% 2%

(Source: I-Cube2008, Annual IMRB Syndication)

The above table shows the number of users who have clicked on an online display advertisement which has led to the product purchase across product categories. The maximum conversion from visibility to the purchase is observed for investment options like Mutual Funds followed by Air Ticket advertisements and advertisements regarding Education/Training. In addition to this, these product categories draw higher customer involvement leading to higher number of users searching online information after witnessing an advertisement. Although, irrespective of higher visibility online purchases for Insurance products are lower. This shows that function of online advertisements is to create awareness while traditional method of selling these products through financial advertisers is more preferable for Insurance products.

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5.6 Problem seen by Internet users in Online Advertisements

Figure 12: Problems seen in Online Display Advertisement

70%

62% 54% 52% 47% 37% 34%

They present misleading information

They do not offer comprehensive information

They are less likely to make me purchase

Base: 1.8 Mn Active Internet users who have clicked on online Advertisements (Source: I-Cube 2008, Annual IMRB Syndication)

Active Internet users feel that online advertisements are misleading and distracting. This could be attributed to reaching not to the exact page where product is advertised but to the home page of the advertiser after clicking an online display Advertisement. This is not in accordance with the requirement of the users who are in a search of a good deal but ultimately leading to the advertisers home page and not to the product advertised. While 37% of the Internet users state that they ten to ignore ads, however, the corollary is that quite a few of (66%) feel that online display advertisements serve wide variety of products and these advertisements are generally not ignored by them.

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I ignore them

They do not offer a wide variety of products

Ads are distracting

They are irrelevant

6.0 Online Advertising in SME

Figure 13: Advertising Methods Utilized by SME
44% 45% 34%

31% 23% 23% 23% 21% 22% 15% 8% 6% 8% 6%

3% 2%
Radio

Newspaper Yellow Pages

Magazine/ Journals

Internet

Out of Home (Billboards, Hoardings etc.)

Online Classifieds

Others

Advertisement Methods Currently Used

Likely to advertise in future

Source: I-Cube 2008, Annual IMRB Syndication

Small-Medium Enterprises4 (SMEs) are keen on advertising in specific geographies considering constraints regarding the scope of operations and limited advertising budgets. This might have resulted in the higher popularity for Newspapers, Yellow Pages and even online classifieds. Interestingly, SMEs are embracing Internet as an advertising medium including Internet advertising as well as online classifieds with considerable percentage of awareness and likeliness of usage in future. It has been witnessed that online advertising has gained acceptance among SMEs in India and Internet medium is capable of having an impact on the audiences with considerable percentage of SMES showing likeliness of using online advertisement in future.

For the purpose of the study we defined SME as an enterprise with employee strength of 11-250. Only those SMEs which had either a Head office or a single office in the Top 8 Metros (Mumbai, Delhi, Kolkata, Chennai, Hyderabad, Bangalore, Pune and Ahmedabad) were considered.

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6.1 Awareness and Usage of Online Advertisements amongst SMEs

Figure 14: Awareness/Usage of Online Advertising Options (SME)

74%

69%

44% 35% 27% 22% 14% 7% 10% 10% 3%

Content Based ads Results on search Sponsored search engine item on a search engine

33%

31% 20%

Banner Ads on Portals and other w ebsites

email Marketing

Advertisements in Blogs

Pop-ups

Awareness of Online Advertisement Methods

Present Usage of Online Advertising Methods

Source: I-Cube 2008, Annual IMRB Syndication

Overall, display advertisements are more popular among SMEs compared to the search engine marketing in India. The highest conversion from awareness into actual usage exists for Online Banner advertisements followed by email marketing. Few SMEs use Pop-ups as preferred type of online advertising. Compared to the online display advertisements there is lower awareness and usage of SEM (Search engine Marketing) among SMEs. It has been observed that SMEs prefer local search engines for advertisements and some of these even opt for sponsored search links on these search engines.

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6.2 Barriers for Using Online Advertisements amongst SMEs

Figure 15: List of Barriers for Using Online Advertisement

36% 32%

22% 18% 16% 9% 10%

Inadequate reach

Less effective

Lack of awareness

Lack of Online expertise for advertising is implementation not relevant to the brand image/ objectives

C onsidered more intrusive than others

Others

Source: I-Cube 2008, Annual IMRB Syndication

Inadequate reach and perception of Internet as a Less effective media are the main barriers preventing SMEs from using online advertising. Lack of awareness among people and lack of expertise are other important barriers for not using online advertising.

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7.0 Emerging Trends in Online Display Advertising Market

Online advertising avenues include various web-based options using which brand and marketing messages get delivered. These options include search engine marketing, banner ads, rich media, digital video, email marketing, lead generation, classifieds and sponsored links. Search engine advertising comprises a high proportion of the overall options due to efficient search engine avenues. Online display advertisement comprising banner ads, rich media, digital video and sponsored links has relatively large number of participants but enjoys a limited share in the total spends. There are, however, inherent differences in these options. Online display advertisement provides a marketer an option to generate awareness which in turn will result in brand-building in long run. Meanwhile through search advertising a marketer can generate leads in a short span of time. Search engine marketing provides a distinct advantage of enabling a marketer by providing complete control over a campaign with selection of keywords and the ability to place the advertisements on the selected websites while the same does not hold true for online display advertisements

7.1

Performance based online display advertisements

The yardstick to measure the effectiveness of online advertisement has evolved from mere number of impressions to the customer acquisitions leading to performance based advertisements. This trend is very much apparent in India where in pricing for online advertising campaigns are frequently measured against the performance. In some of the recent examples seen, the display advertising is evolving to deliver performance and leads similar to the ones delivered by search marketing. There are transactional banner systems5 emerging which enable users to purchase products and services via banner without visiting the vendors website. This service has generated better response rates compared to the traditional banner for some of the clients.

http://www.bizreport.com/2007/07/new_type_of_banner_ad_launched.html

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7.2

Integrating Internet advertising in marketing campaigns

Recognizing the possibility of using Internet as an effective tool for targeting niche audiences, innovative perspectives are being practiced by established and traditional institutions. During the recent US Presidential elections, Barak Obama's team ensured that the campaign had a strong presence on social networking sites such as Facebook, MySpace and LinkedIn. Through such presence, Barak Obama ensured he maintained a two-way interaction with his electoral. In the recent general elections in India (early 2009), many Indian politicians considered Internet as a useful platform for interactive political communication especially with youth. Indian National Congress party used sites like YouTube and Facebook to execute web-based social marketing campaigns. With 50 Million Internet users in Urban India and majority of them in the age group of 18-24 years, Internet was found to be an effective tool to engage with them. Bhartiya Janata Party (BJP) launched a website LKAdvani.in for its prime ministerial candidate Lal Krishna Advani. Further, both the key parties (Congress as well BJP) teamed up with top Internet companies for spreading their campaign messages over the Internet. Apart from the political general elections, several brands have started integrating Internet as part of their communications. The key ones to do so in 2009 include Tata Tea, Nike, Nokia, Perk, Vodafone, Airtel, etc.

7.3

Immersive formats for Internet Advertising

The advancement in the technology is leading to the development in the area of online display advertisements allowing display advertisements to become more immersive, interesting and useful. Thus combined with the traditional advantage of delivering contextual messages at the right time, with the emerging technologies, the marketers
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can now allow their target audience to indulge into an in-depth brand experience. Thus with the advancements in the space the Expandable Banner: Expandable banners which use a new technology that allows the banner to expand when the user rolls over them. These banners are fresh, exciting, compelling and highly interactive to the viewer. They can deliver a story with a mouse over or give an enticing hint to what users can expect when they click on the banner and led to a micro-site. Most of the portals have already adopted these for inventory on their home pages. Augmented Reality (AR): AR will offer different various advantages for different forms of online display advertisement in future. The goal of augmented reality is to add information and meaning to a real object or place. Unlike virtual reality, augmented reality does not create a simulation of reality. Instead, it takes a real object or space as the foundation and incorporates technologies that add contextual data to deepen a persons understanding of the subject. Augmented reality is designed to blur the line between the reality the user is experiencing and the content provided by technology. Augmented reality adds graphic, sound and smell to the virtual world as it exists in the real world. Technological development in the field of AR is leading to the acceptance of this technology in various marketing activities. Of these, usage of AR is predominantly witnessed in the field of advertising. Large corporate like P& G, IBM have used AR in their latest advertisements6. IKEA PS, dealer in household furniture has offered mobile augmented reality solutions which enable users to imagine how this furniture would fit in their houses7.

http://funkadelicadvertising.blogspot.com/2009/09/top-10-augmented-reality-adveritising.html

http://www.itvt.com/story/5315/procter-gamble-use-augmented-reality-make-print-advertising-interactive
7

http://www.mobiadnews.com/?p=3829

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8.0 Endnote

Over time, the online advertisement space is expected to change its composition. Presently, search engine marketing has a fairly high share of this space which is glaring in matured markets. Display advertisement, however, will continue to hold its share due to its distinct advantages such as ensuring long-term impression of a brand, a higher possibility of interactivity and delivering rich media messages to users. At the same time, online publishers and agencies are developing the space to deliver an immersive brand experience by bringing in concepts like augmented reality. The market is poised for huge growth, specially considering the fact that the traditional advertisers (FMCG, Consumer Durables, etc.) still form a small proportion of the overall online display advertising market in India . Further, the medium has a high viability for opening up a new segment of buyers altogether the SMEs which form a substantial chunk of businesses in India. In order to grow the market, the online display advertising industry in India needs to develop globally accepted performance measures that also cut across various other media vehicles like television, print and radio. This would allow true media meshing. With the distinct advantage of online in terms of the number of hours spent online, immersive experience that online can offer and the contextual delivery of messages, online advertising is bound to emerge a winner. Further, the online publishers need to continue developing better user experiences so that online ads are not seen as a nuisance, rather are sought after. All in all there are exciting times ahead for the online display advertising in India.

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About eTech Group | IMRB

eTech Group | IMRB (a specialist unit of IMRB International) is a research based consultancy offering insights into IT, Internet, Telecom & emerging technology space. Our continuous link with industry and a constant eye on the pulse of the consumer ensures that we can decode the movements of technology markets & consumers. To our clients we offer an understanding of the present market environment and a roadmap for the future. Contact Details:
eTech Group | IMRB IMRB International A Wing, Mhatre Pen Building Senapati Bapat Marg, Mumbai Tel : (91)-22-24233902 Fax: (91)-22-24323900 www.imrbint.com

Research team for this report:

Balendu Shrivastava, Group Business Director Tarun Abhichandani, Insights Director Rohit Gangwal, Research Manager

Contact us:
balendu.shrivastava @ imrbint.com

About Internet and Mobile Association of India (IAMAI)

The Internet & Mobile Association of India (IAMAI) is a not-for-profit industry body registered under the Societies Act, 1896. Its mandate is to expand and enhance the online and mobile value added services sectors. It is dedicated to presenting a unified voice of the businesses it represents to the government, investors, consumers and other stakeholders. The association addresses the issues, concerns and challenges of the Internet and Mobile economy and takes a leading role in its development. The associations activities include promoting the inherent strengths of the digital economy, evaluating and recommending standards and practices to the industry, conducting research, creating platforms for its members, communicating on behalf of the industry and creating a favorable business environment for the industry. Founded in January 2004 by leading portals in India, IAMAI in the only specialized industry body in India representing the interests of online and mobile value added services industry. Contact Details: Dr. Subho Ray, President, IAMAI
406, Ready Money Terrace, 167, Dr Annie Besant Road, Mumbai - 400 018 Tel : +91-22-24954574 | Fax : +91-22-24935945 | http://www.iamai.in

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Published By:
Dr Subho Ray, President, on behalf of Internet and Mobile Association of India, 406 Ready Money Terrace, 167, Dr Annie Besant Road, Worli, Mumbai 400018

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