The year 2014 was an eventful year for both the ecommerce industry and the advertising industry. The e-tailers approach to woo customers using traditional as well as digital advertising has culminated into a boom for the advertising industry.
With leading e-tailers viz, OLX, Snapdeal, Flipkart and Amazon have spent a whopping Rs. 600 crore on ads in 2014 with the overall industry spend crossing more than Rs. 700 crores as per data revealed by TAM Adex while, the advertising budget in 2015 could definitely cross Rs. 1000 crore as per estimates.
The breakup analysis of the ad-spend in 2014 reveals interesting trends. Nearly 50-60% of the advertisement spend was done on television ads followed by 15-20% of the total on print media while out-of-home media and radio enjoyed the remaining ad spend. In all likelihood, advertising agencies expect the advertisement spend to increase by nearly 20% in the year 2015. Also, jacket ads across newspapers amounted to just Rs. 32-35 crore from the total funds on advertising.
The e-tailers industry is spending much more than any other industry till date including telecommunication, automobile companies, and consumer durables on advertising. The major spenders include Amazon though a late entrant, Flipkart and Snapdeal. In 2014, they focused on jacket ads and have spent nearly Rs 60-70 crore on ads in these premium positions.
Come 2015, the advertising spend will be a mix spend encompassing television and digital media with a focus on building the brand and its image, signing up of celebrities as brand ambassadors and enhancing their visibility across sports and entertainment events happening across the country.
The advertising spend is likely to remain high for the next couple of years as the e-tailers need to firmly etch their brand image within the minds of the shoppers. At the same time, the need of the hour is to be visible where the shoppers and highlight their offerings.