From Paytm Ads to Airtel Ads – how consumer tech companies are cashing in on from ad revenue

From Amazon to Flipkart, Paytm to now even Airtel — consumer tech platforms with a substantial base of users have found yet another way to monetise — that is through advertising. What is to be noted here is that this is not a novel idea, the good user base allows all of these platforms to show ads and charge brands in lieu. “With brand safety being a major issue, companies want platforms that can showcase their products in the right context. One of the big problems that brands face when they give their budgets to an affiliate network is that they don’t know where the ad will be placed, hence, our platform aims to address this issue,” Adarsh Nair, chief product officer, Airtel, told BrandWagon Online. As per a report by Criteo ‘Covid-19 Impact on Marketing,’ four out of five marketers say not showing up next to hateful/fake content is important to them — winning customers is critical, but staying relevant and safeguarding their brand’s image is also a huge factor.

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According to GroupM’s This Year Next Year (TYNY) report 2021, digital advertising spends are expected to register a growth of 28% this year to reach the Rs 27,700 crore mark. Industry estimates suggest that companies typically spend 30-40% of their marketing dollars on digital advertising depending upon the category– of this 10-12% is spent on e-commerce marketplaces. According to sources, some of these platforms are believed to be charging cost per thousand impressions (CPM) of Rs 80-90 for ad slot. Interestingly, most brands have increased their spends on e-commerce marketplaces following the immense boom in the sector brought about by the Covid-19 pandemic. “Today, it is not just about the product, it’s about an end-to-end solution for a marketer. Therefore, if a technology partner can help drive all aspects of a marketing funnel from awareness down to conversion — that is where the real opportunity lies. The big advantage with digital, especially larger ad tech players is the full-funnel solution that they provide,” Taranjeet Singh, managing director, South East Asia and India, Criteo, stated.

Infact, Criteo’s report suggests that 55% of marketers are likely to increase their advertising budgets on retail websites/apps in 2021 while 58% are likely to increase spends on website/content marketing. Experts observe that the return on investments from these platforms is better than the traditional channels in some categories. For instance, in categories such as electronics and apparel segment, the return-on-investments (ROI) is often twice as good as that of other platforms. “More than 25-30% of the people who shop on marketplaces end up buying a different product altogether which was never in their consideration set. Today, advertising on e-commerce platforms gives smaller brands the ability to hijack the consumer on their journey, and take on a larger brand, by investing their marketing dollars on these platforms,” Vishal Jacob, chief digital officer, Wavemaker India noted.

While the ad tech space has gained momentum, experts believe the key lies in being customer centric. For instance, putting a frequency capping on advertisements to ensure that the customers are not inundated with ads while also making the ads native so that it matches the form, function and content of the platform– are some of the ways platforms can provide a seamless experience. “While there’s too much of a choice, consumers have been empowered to choose brands which they wouldn’t otherwise be able to do without advertising,” Jacob observed.

Read Also: Star Sports to earn Rs 3,600 – 3,800 crore ad revenue from IPL 14 this year

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