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E-tailers ad spend grows15-20x compared to brick-and-mortar retailers: Study

E-tailers ad spend grows15-20x compared to brick-and-mortar retailers: Study

Author | exchange4media News Service | Friday, May 27,2016 8:09 AM

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E-tailers ad spend grows15-20x compared to brick-and-mortar retailers: Study

Anyone with a smartphone and a decent internet connection in India would most likely engage in some form or the other with e-commerce websites. The country has, slowly but steadily, adapted to on-line retailers and has made the transition from physical shopping to online purchases. 

Amazon India secured the title sponsorship of the India Fashion Week, displacing Wills Lifestyle. India's giant e-commerce companies are now looking to take up sponsorships of major television shows, fashion and sporting events to increase their visibility. Case in point is Flipkart, which has splashed mega-bucks on the Indian Super League and the Pro-Kabaddi League to ramp up their brand quotient.

Hitesh Gossain, CEO of Onspon.com which is India's biggest sponsorship marketplace, shares some of the other major developments on the e-commerce sponsorship front, “Last year, Snapdeal.com became an associate sponsor of the Bangalore Fashion Week. Online fashion retailer Jabong is an associate sponsor of Lakme Fashion Week and official retail partner of marathons in Delhi, Mumbai and Bengaluru. Myntra is sponsoring a women's marathon event in Bengaluru and has earlier partnered with events like Miss Diva."

"Being a brand which is connected to youth...fashion and sports are the areas to create our communication and our brand positioning," said Praveen Sinha, managing director of Jabong in a statement to one of the leading business newspapers of the country.

A Snapdeal spokesperson also echoed the same line of thinking and said, "We evaluate various opportunities for partnerships for brand building and take decisions based on the returns on investment from any association."

Gossain explains these decisions by e-commerce brands with some more insights, "At Onspon we evaluated certain strategic decisions by e-retailers and found that there exists tough competition amongst them in the sponsorship zone. We expect them to continue their sponsorship deals along-with advertising with aggression on traditional channels like television and print to strengthen their brands."

Loaded with private equity money, online companies have been splurging on advertising in recent months as more and more consumers across the country have migrated online.

In an estimated assumption, it can be deduced that e-commerce companies have spend Rs 300 crore on advertising during the festive season of October-December quarter, outspending brick and mortar retailers almost 15-20 times.

Fashion, lifestyle and sport have been the quickest growing segments for e-commerce companies. Amazon, a relatively late starter in selling fashion, is currently playing catch up with the likes of Myntra and Jabong. A lot of new age vertical segment players in spaces of fashion, furniture etc., are too gearing up for this and are already in discussions for partnerships across the plethora of high quality platforms available.

“'With several high-visibility based properties already on offer on our platform onspon.com ; it is likely that we will see more from the e-retailers as we head into the second half of 2016,” adds Gossain.

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