New Delhi, October 3: After print, television and websites, it is the search engine advertisements that Indian marketeers are waking up to.
Indians log around a billion searches on the Internet every month and the figure is growing. With an urge to grab the attention of this segment, around 40,000 advertisers, according to an industry study, are posting their ads on the search engines.
An estimated amount of Rs. 236 crores was spent on the search engine marketing business, around 72 crores being spent by the companies in India, and the rest coming from the companies abroad.
“We were surprised by the amount of money spent by foreign advertisers who are not even based in India,” says Dr Subho Ray, President, Internet and Mobile Association of India (IAMAI) which commissioned the study.
A search engine ad works in the following way: A search engine, say a Google or a Yahoo offers a service, which allows companies, for a small fee, to have a link to their website featured when a user searches a specific keyword which the company specified. In this way the company can hope that its site will get clicked by the user. This is also known as the ‘pay-per-click’ advertising.
The advertiser pays when the user clicks on its advertisement, generally a weblink. This is considered a far better method to meet the target audience and their response.
Of the one billion searches, over 300 million searches had ads on them, and almost five million of the ads featured were clicked on. This according to industry experts is a very good ratio.
Talking about the growth of the search engine advertising, Mahesh Murthy, CEO of Pinstorm, which did the study, says, “for an industry that got off the ground a couple of years ago, it’s a huge leap.”
There were as many as 90 Indian brands that spent more than Rs. 10 lakhs a year on the search engine ads. According to the study, on an average, an advertiser in India pays Rs. 16.20 per ad. Top spenders include job sites, matrimonials, search engines and banks.
“The spenders also surprised us as we had thought automobile industry would be dominating the list,” says Ray.
Although no direct figures from the industry were available for Pinstorm, they came to the conclusion through a complicated process and based the data for the month of August 2006.
“What we did was analyse all data that was in public domain by running searches, noting the presence of ads by assigning a value to those ads from experience, and making some calculations,” says Murthy about the report.
“I think sky is the limit for this type of advertising, and we are not talking of the potential as we may just understate it,” says Ray.