With a huge audience with a clear intent on carrying out transactions, online marketplaces have emerged as a strategic advertising platform for brands, and platforms like Quikr, Flipkart, Snapdeal, ShopClues and Amazon are among the e-retailers in India looking to cash in on this.
Speaking to exchange4media, Vineet Sehgal, CMO of Quikr, said that Quikr’s Advertising Platform (QAP) has seen more than 100 per cent YoY growth in the last 2 years in terms of both revenue and advertisers. The platform now boasts of 100+ advertisers with telecom companies, including both service providers and handset manufacturers, BFSI, consumer durables, automobile, e-commerce and retail being the main categories.
The advantage, says Sehgal, is that the audiences on Quikr are strictly ‘in-market’ as opposed to audiences on platforms such as Facebook, who might not be on it looking for making a transaction.
“One of the large revenue streams for us is advertising. Quikr is a platform where people come to browse, sell, buy and look for multiple categories. This gives a perfect opportunity for a marketer to target audiences in the relevant category. It is about sharp targeting and getting powerful results out of that. The single biggest advantage is that we know what are consumers are buying or selling and we have a lot of information on how frequently they are transacting, their lifestyle, choices, etc.,” he said.
Quikr currently sees a total traffic of 25 million+ unique visitors per month with around 75-80 million visits per month.
Quikr is of course not the only Indian e-commerce player that is looking to take advantage of their unique position. In 2016, just about an year after it acquired ad tech firm AdIquity, Flipkart launched its advertising platform with over 50 brand partners. It had forayed into digital advertising in 2015 with the launch of Product Listing Ads. According to media reports, Flipkart generates nearly USD 1 million per month in just advertising revenues and the company has ambitions of becoming India’s largest digital ads platform in the coming years.
Snapdeal launched an ad platform in 2016 and the company says that 10,000 sellers and 200 brands and agencies have used the platform in the first 9 months. The company told media in March that it is looking at generating Rs 100 crore in revenue from its ad platform. ShopClues also has a native advertising platform called AdZone.
ShopClues collaborated with technology company C1X to build AdZone. Sunil Punjabi, Vice President and Head of Business - South Asia at C1X Adtech explains, “C1X works with Shopclues through its Martech platform called SOKA (which is called AdZone at Shopclues’ end). It has been our experience that AdZone has resulted in increased GMV for Shopclues, not to mention the increased ad revenues. It is a testimony to the value of the platform that Shopclues has signed up with C1X for another year and has also promised to deploy more resources to this effort to realise its true potential.”
According to Punjabi, e-commerce players are beginning to show an increased leaning towards the need to harness the rich data that they generate every day within their ecosystem and convert it into monetisable asset. “And it is not an isolated instance. Every day, we read stories of more and more players waking up to the lure of ad revenues,” he added.
The idea of marketplaces becoming premium advertising properties is not new and has been successful in China where e-commerce behemoth Alibaba earns more mobile advertising revenues than Baidu, China’s answer to Google. According to research, Alibaba earns more than 40 per cent of all mobile revenues in China. eMarketer further postulates that it will draw nearly one third of China’s digital spending in 2017, a figure that comes to around USD 16.04 billion.
“Over the last few years, starting in geographies like the US and China, entities like Alibaba and Amazon have become huge environments for consumers to transact in and to find the products they want to buy, rather than to go to a search engine or to a website. Today, in many instances, consumers are starting on these platforms to find what they want to buy. So, these platforms have demand and consumer eyeballs. In many cases, because these are buying environments, they are performing better than other channels,” opined Michael Kahn, CEO, Performics Worldwide.
Even agencies have gotten wise to the potential of this medium. In November last year, Dentsu Aegis Network acquired e-commerce consulting firm Bluecom Group, which has now been rebranded to Isobar Commerce. With the services expected to launch soon in India, Jane Lin-Baden, CEO of Isobar Asia Pacific, explained the rationale about a dedicated Commerce division: “For every brand, you cannot just talk about branding; every brand needs to sell and so agencies need to play a role in getting every brand to sell. Isobar Commerce is service-led; from consulting to mobile commerce to third party commerce through Amazon, etc., and also their own platforms. This is a holistic solution and it is not just about buying media but how to operationalize commerce.”
So, should traditional online publishers start worrying about taking a hit in terms of ad revenues due to this new breed of competitors? No, according to experts and practitioners across agencies and e-commerce platforms we spoke with. With digital advertising growth expected to keep propelling upwards for the foreseeable future, there is enough money to go around, they opine. However, it is an indication of how the pressures of business are forcing digital platforms and advertisers to increasingly adapt and think out of the box.