The Internet portals in India are witnessing a strong advertising support by the financial companies. Driven by the intense market competition, they are resorting to Internet as a preferred medium for advertising and direct marketing heavily.
The financial sector companies are not only the early adopters of Internet but also its heavy users. What makes Internet so dear to the financial sector? Shikha Sharma, the Managing Director of insurance major ICICI Prudential said, "Life insurance is still a nascent industry and consumer awareness levels about the benefits of life insurance and different products available is still low, albeit rising. The Internet is an excellent medium to reach out to a large base of people in a focused manner to spread this awareness. It allows the company to provide detailed information (through links) to an attentive audience at a reasonable cost."
Besides using aggressive advertising on rediff.com and cricket based portals, ICICI Pru has recently entered into an alliance with indiatimes.com also. As per the deal, indiatimes will refer its subscribers and users along with other Times of India group customers, who are interested in purchasing life insurance policies, to ICICI PruLife.
Sanjay Trehan, General Manager-Internet, Hindustan Times further adds, "All call to action based advertising is suited to the medium (Internet). Besides, financial trading community and its converts like fast paced access to news, so they are always in a receptive mode." Hindustantimes.com itself draws heavy promos from the ICICI bank.
Kim Sharma, Head-Online Marketing of Intercept Consulting, an online marketing solutions company explains, "They can effectively isolate a niche consumer segment and market the relevant offering therein. In this scenario, response rates are not only higher but results in extremely low costs of acquisition. Every action taken by a user is trackable and an advertiser on the basis of the initial responses can take further action. Thus campaigns can be tweaked in real time."
Commenting on their strategy, Sharma of ICICI Pru said, "The online advertising strategy is response based, wherein the websites are not only used as an advertising option but also to generate leads." Their strategy seems to be paying off as she claims 2 million hits on the company website each month, which is comparable to many other commercial websites.
Yahoo! India is perhaps the biggest beneficiary of this online splurge by the financial companies. "Some of the most consistent and large spenders on Yahoo! India continues to be financial institutions," said the proud country head of Yahoo! India, Deepak Chandnani. ABN Amro, American Express, Apna loan, Citibank, HSBC, ICICI and JM Morgan Stanley are among the whopping 17 leading financial companies advertising on Yahoo! India.
But does it actually work? Intercept's Kim Sharma said, "The response rates vary from segment to segment. Currently, the highest response rates are happening for credit cards ranging from a respectable 5% on a banner to an eye-popping 35% on a mailer. Another category which enjoys high response rates are life insurance products which also uses the medium for recruiting life insurance agents with response rates ranging from 2-25 %."
She further adds, "Home loans as a category is just off the blocks, and is showing high growth rates too. However, response rates are relatively lower than the above categories, as Net advertising can only act as a reminder, and not as the key driver."
Comparing the Indian situation with the global phenomenon, Trehan said, "The scene is no different globally. Worldwide, financial advertising constitute about a quarter of total online spends." But he concludes that in terms of sheer sophistication and interactivity, we have still have a long way to go!