5-7% of online media budget being spent on ad networks: experts

by Satrajit Sen

According to ad network Collective Media’s ‘2008 Ad Network Study’, agencies and advertisers will spend more on ad networks in 2008 than 2007. The study also estimates that around 75 per cent of advertisers would spend five per cent or more of their overall online advertising budget on ad networks in 2008.

AlooTechie, in its endeavour to find out the shift in online media budgets in India, spoke to experts who have been closely monitoring the online ad industry and found that around five to seven per cent of online media budget of Indian clients are currently being spent on ad networks.

Ratish Nair, CEO, Interactive Avenues , has said, “Though, bulk of our revenues, at least 90 per cent, comes from direct clients, there has been a shift of around five to six per cent observed in the media budget strategies of advertisers, after the concept of ad networks was introduced.”

“After the advent of ad networks, clients have changed their advertising preferences and today, around five to seven per cent of the advertisers’ budgets are spent for ad networks,” says Nitesh Kumar, planning manager, digital media, Media2Win .

Goutam Sathia, assistant vice president, marketing, Compare Infobase , adds, “The realm of ad network is growing and developing day by day. People see it as a viable medium of information exchange wherein they can easily locate their target audience, and hence are ready to pay. At least six to seven per cent of a client’s online media budget is meant for ad networks.”

Ramana Reddy, director, AdsForIndians , says, “With the entry of ad networks in India, advertisers found a new media channel for their advertising needs. It makes easier and cost effective for them to advertise through ad networks, than dealing with individual portals. Also they can reach the targeted audience than the traditional news portals. Now the advertisers are planning for increased budget spending on ad networks than before.”

“Currently, ad networks get about five to six per cent of online ad spends in India; whereas the average in US and UK markets varies between 11 to 15 per cent of the total online ad spends,” Mohit Maheshwari, managing director, Tonic Tag Media , has said. “Having said that, I will definitely want the numbers to increase as this medium offers a huge scope of fast communication.”

According to Ratish Nair of Interactive Avenues, “The online ad networks seem more mature as most of them don’t just have stable and growing revenues, but are profitable. And since they can churn out quality work at much lower costs than rivals abroad, they make attractive targets for foreign advertisers as well.”

Speaking about the scope of ad networks in the online advertising field, Nitesh Kumar of Media2Win has said, “There is a massive scope for growth of ad networks in India. But unless the people understand and make an effort to know more about the realm of internet, the space will remain unexplored.”

Ramana Reddy of AdsForIndians says, “As the ad network concept is very new in India, many publishers and advertisers are still evaluating them to find out the best suitable ad network for them. So the scope for ad network advertisement is very positive and encouraging as the advertisers are seeing the benefits.”

According to experts, selecting the right ad network partner can make the difference between a hit and a miss for an online ad campaign. “Before selecting any ad network, an advertiser should research and find out what kind of ROI (return on investment) the ad will provide,” Goutam Sathia of Compare Infobase has said.

“Every media plan developed by a planner can be measured by three quantifiable metrics for all digital media bought and sold. They include reach, impressions and technology. The ROI gets better whenever these three metrics come in sync and hence advertisers should always seek out these proportions,” adds Goutam Sathia.

Mohit Maheshwari of Tonic Tag Media has said, “As of now, lots of inventories are going unsold and the value is also less. The call of the hour is that India needs people who come with a basic knowledge of the online industry. Good and experienced online media planners can very easily turn the tide towards the favour of ad networks.”