At a time when the consumer Internet market is witnessing a boom, online users are likely to spend Rs 9,210 crore (Rs 92.1 billion) on buying and selling goods or services in 2008.
According to a survey conducted jointly by the Internet and Mobile Association of India and IMRB, the consumer Internet market is growing at 30 per cent and this is lucrative enough for Microsoft and Google, with each trying to outdo the other.
The 38.5 million Internet users, according to an IAMAI study, have become the prime target for numerous advertisers clouding the web.
Recently, Microsoft launched the platform in India with four leading publishers -- Bollywood Hungama, Equity Master, HDFC Sec and Facebook. Microsoft also launched its video ad platform with MSN video and its mobile advertising initiative.
"Microsoft will provide display, rich media, contextual and video advertising solutions for its advertising partners on the platform. NDTV Media, the exclusive sales partner for the Microsoft Digital Advertising Solutions, will bring advertisers to the platform," shared Rajnish, head, Microsoft Digital Advertising Solutions (India).
Microsoft also announced the launch of its mobile advertising initiative in India. Advertisers will now be able to buy search keywords on Live Search deployed on Vodafone Live and also display banners on MSN Mobile portal.
Strengthening its position among advertising and marketing agencies, Microsoft appears to be sending a message to designers and developers who create rich media for the web that it is serious about online and mobile ads.
Satya Prabhakar, CEO of Sulekha.com, feels, "The local commerce in India is in two buckets, namely Classifieds and Yellow Pages."
Sulekha is one of the leading online local commerce destination in India with over 150,000 visitors using its classifieds and yellow pages service everyday. The portal is registered with ad platforms like Google AdSense, Komli and tribalfusion.com.
Prabhakar opines, "With Google's nearly 80 per cent market share in India and around 40 per cent in the US, they are a better ad platform for both the advertisers and the audiences."
Going for the smaller businesses, Shailesh Rao, managing director, Google India, announced the launch of easy payment options for smaller businesses.
"Introduction of payment for Adwords by cheque, demand draft and net banking is in sync with Google's endeavour to offer small advertisers more flexibility, and helping in driving online advertising and e-commerce in India."
The total market size of the Indian advertising industry is around $5 billion and online advertising is pegged at around $120 million. Niraj Dutt, COO, NDTV Media, says, "This is less than 1 per cent, which is very small when compared to the US where the online advertising industry contributes around 10 per cent to the total advertising market."
For Neeraj Roy, CEO, Virtual Marketing which operates Bollywood Hungama, partnership with Microsoft seems promising.
"As music labels and marketers step up their experimentation with new and emerging business models, the music CD continues to fade away. We expect Microsoft's ad platform to extend our reach to more ad-supported sites, reach out to a global audience, offer full-track downloads and use the social networks like Facebook as music discovery and sales tools," he says.
Although targeted advertising is getting the lion's share of attention and will continue to be a hot button in 2008, other forms of social network marketing, such as search advertising, widgets and e-commerce, will draw marketer interest, predict analysts.
If Microsoft's offer for Yahoo, for $44.6 billion, is accepted and passes regulatory hurdles, it would naturally result into the highest trafficked Internet destination.
That would obviously be a boon for a combined Microsoft-Yahoo online display advertising business, building mass at a time when the online ad market appears to be fragmenting at a breathtaking pace.
