GSM telecom companies in India have now increased their budget for digital advertisements. The results of the last quarter show that data revenue make up significant part of the total revenue for the telecom operators.
The telcos were spending about 5-10% of their advertisement budget on digital media a few years back, but now they have increased it to 15-20%. This shows that they now targeting customers who will use a lot of data.
MTS spends a large part of its advertisement budget on digital ads. Their expenditure on digital ads was 7-10% of their total marketing budget in 2012, but now it is allocating about 50% the budget for digital promotions on WhatsApp, Instagram, YouTube.
Who can forget this MTS ad showing a baby who was born to use the internet:
Vodafone famous for its ZooZoo ads has also upped its digital advertising budget to 15%. It was 5-6% 2-3 years back. According to the sources, half of Vodafone’s annual advertising budget of Rs. 200 crore goes to TV ads. The rest is split between digital, sponsorships, and out of home advertisements.
60% of Idea Cellular’s revenue come from its subscribers in rural areas and it has still recorded a 35% hike in its digital advertising budget.
On the other hand, Uninor, which is currently operating across 6 circles in India is yet make its digital presence felt by its customers.
Vodafone Chief Marketing Officer Vivek Mathur says, “Bulk of advertising is still T.V. because it is the most cost-effective medium to reach a large number of people. But what’s useful about digital is it helps in catching the customer at the right moment.“
According to Shankar of Idea Cellular, digital ads reduce wastage as they are highly targeted and hence offer better RoI (Return on Investment).
There is a lot that is happening in self-discovery. The amount of growth that happens in consumption is such that today people go from 200 MB to 700-800 MB very quickly,” says Vodafone’s Mathur. The growth curve at this point of time is very gentle but the growth rate for data consumption in the 16-25 year age group is growing at an exponential rate.
I totally agree with what Mr. Mathur has to say about the growth rate of data customers. Every smartphone owner wants to be on the internet, and they should be. What would one do with a smartphone they are not connected to the internet?