Ad-revenues are still relatively uncommon in India. Most of the ad-revenues are still driven and earned by Google and Facebook with almost everyone using their platforms for advertisements.
This may change soon though. India’s unicorns from the eCommerce segment are planning to launch their own advertisement programs and while Flipkart already made its intentions clear of the same earlier, the latest to join the list is its closest rival Snapdeal.
Snapdeal has announced to launch its advertising program which will help the sellers on its platform to post advertisements of their products and boost their sales.
The advertising tools will help our over-two lakh strong seller community simplify their business journey and boost overall revenue as more users discover their products.
said chief product officer Anand Chandrasekaran.
This, of course, will result into additional revenues which in future may also prove to be a major source of revenue for the company.
The program will be launched in phases with the initial focus on native ads, i.e, ads related to the content of page on which they are displayed. This will help the sellers to increase the visibility of their products on the platform on its website, mobile site and app. In the second phase, which is expected to take between 3 to 6 months, ads of other formats such as banner ads will be made available to the sellers.
According to people familiar with matter, Snapdeal has been working on the platform for nearly 4 months now. It is being led by Asif Ali, founder of Silicon Valley based advertising platform Reduce Data, which was acqu-hired by Snapdeal in September. The company helps the brands to optimize their advertising campaigns by using artificial intelligence, real-time data and various other tools.
Earlier this year, Flipkart too had acquired a mobile advertising firm, Adquity Technologies to develop innovative advertisement solutions for its platform. Clearly, the e-commerce companies are looking to diversify their revenue streams in order to eventually reach profitability some time in the future. And ad-revenues are one of the most lucrative ways to do the same.
This has become even more evident by the revenue model of Chinese e-commerce giant Alibaba which relies heavily on gains from advertisements with ad-revenues constituting almost more than half of its total revenues. This has made Alibaba one of the biggest online advertising businesses in China in addition to being the biggest player in e-commerce.
For now, Snapdeal has not revealed any details about its revenue targets or the commission model it plans to launch.