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Ad spend on social media to grow by 44 percent
By siliconindia
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Thursday, 01 October 2009, 22:52 IST
New Delhi: Even though social media sites are growing in popularity, a latest report by Webchutney says that only 13 percent of the total Internet ad spends have gone into social media initiatives for the year 2008-09. The report called as Digital Media Outlook 2009, studied the top 500 marketers in India. However, the report says that this scenario might soon change and predicts that in financial year (FY2009-10), ad spend on digital media is likely to grow 44 percent.
The report also says that fast moving consumer goods (FMCG) sector is using online advertising the most. Coca-Cola India in August 2009 launched its campaign for Sprite first on the internet. Pepsi, ITC Group, and Colgate Palmolive are some other FMCG brands that have begun using online advertising. The online spend of the FMCG category is around 
16 crore. The total ad spend on social media is currently at 278 crore and is soon expected to reach 400 crore.
"Search is far ahead of social media. Social media is used differently (brands go on social media for word-of-mouth factor). Brands fear that they will have to put up with uncontrolled and inappropriate content from consumers," said Neville Taraporewalla, Head - Microsoft Advertising, Microsoft India to Business Standard. Mahesh Murthy, Founder and CEO of Pinstorm says that the ads which work well on social media are those which engage and involve the users - those that have games, forwarding or other social activities built in. There are very few such agencies which create such ads today.
Google is optimistic that things will change for the better. "With the growing popularity of social networks, many advertisers are showing great interest in tapping the audience on these platforms. But the context and objectives of the campaigns on social networks is different from campaigns on other media platforms - so it's not a fair comparison," said Parminder Singh, Business Head, Google India.
Currently, only companies related with gaming, dating, accessories, electronics and automobiles are using online advertising. Regular advertisers like travel and hospitality and banking/financial services companies are still very cautious.
16 crore. The total ad spend on social media is currently at 278 crore and is soon expected to reach 400 crore.
"Search is far ahead of social media. Social media is used differently (brands go on social media for word-of-mouth factor). Brands fear that they will have to put up with uncontrolled and inappropriate content from consumers," said Neville Taraporewalla, Head - Microsoft Advertising, Microsoft India to Business Standard. Mahesh Murthy, Founder and CEO of Pinstorm says that the ads which work well on social media are those which engage and involve the users - those that have games, forwarding or other social activities built in. There are very few such agencies which create such ads today.
Google is optimistic that things will change for the better. "With the growing popularity of social networks, many advertisers are showing great interest in tapping the audience on these platforms. But the context and objectives of the campaigns on social networks is different from campaigns on other media platforms - so it's not a fair comparison," said Parminder Singh, Business Head, Google India.
Currently, only companies related with gaming, dating, accessories, electronics and automobiles are using online advertising. Regular advertisers like travel and hospitality and banking/financial services companies are still very cautious.
