NEW DELHI: Companies such as Olx, TaxiForSure and HDFC Life have started placing targeted ads on e-commerce websites, hoping to gain by catching the attention of shoppers in research or purchase mode.
The arrangement signals the growing importance of e-commerce websites as a medium of advertising. While it gives e-tailers a chance to monetize traffic, it helps brands release targeted and relevant ads, which are less likely to appear as distraction to online shoppers.
App-based taxi operator TaxiFor-Sure, which recently placed ads on Flipkart and Snapdeal, claims to have received good response. "Every time we put a clutter-breaking ad, we see a 200% increase in traffic. Besides traffic and transactions, we also increased our customer base by 30% through such campaigns," said a company spokesperson.
"These websites have seen an explosion in traffic, therefore, for companies such as us, it makes sense in working with them. Similar to Google and Facebook, this is another medium for us to reach out with the additional benefit of shopping happening," said Lata Subramaniam, chief marketing officer, Sterling Holidays, which recently advertised with Flipkart.
Flipkart and Snapdeal declined to comment.
According to experts in media planning and buying, advertising on e-commerce sites will form an important part of the media mix for most brands in future. "This medium of advertising will grow bigger as the market grows, both for the e-commerce players and also for the brands. Eventually, it will become a significant part of the media mix for brands as it enables point of sale advertising," said Tushar Vyas, managing partner, GroupM South Asia.
Most people who visit e-commerce sites have the intent to make a purchase. Advertising on e-commerce sites is like advertising at the point of sale in a modern retail outlet, experts said.
While e-commerce majors such as Flipkart and Snapdeal have already diversified into publishing online advertisements, smaller players such as ShopClues and Jabong are expected to jump on the bandwagon soon.
"An advertising format like this is a win-win situation for us as well as brands. While it gives us extra monetisation, the brands can do targeted advertising to a narrow and well-defined customer base. We have around 20 million unique visitors every month which brands would like to target for their branding exercise or user acquisition," said Nitin Agarwal, senior director, marketing, ShopClues.
Flipkart acquired adtech firm Adiquity earlier in Marchand Snapdeal is said to be in talks to buy Komli Media. Such acquisitions would enable e-commerce sites to publish online ads to generate additional revenue.
Globally, this model is followed by Alibaba and is expected to be adopted by players in India rapidly.
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