Digital advertising prices start as the Indians hook up on the Internet

Since January 2019, YouTube, the Alphabet-based video sharing platform (earlier on Google), once again doubles the rate of high initial home ad's high incidence – from Rs 70 lakh a day to today in Rs 1.4 crore, a letter sent by YouTube to various media services.

Even when media experts are discussing ROI for digital spending, several IT media agencies spoke saying that the trend of digital platforms such as Facebook, Twitter and Instagram increasing rates between 20-30% per year will continue in 2019 as time spent by users and commitment levels are rising.

Media organizations have seen a higher growth rate over the last three years – over 30% for digital media. The advertising spend on the digital media reaches Rs 11,000 crore last year and is expected to reach 14,500 crore by the end of 2018.

"In 2017, the total digital ad was about 11,000 crore, of which Google was about Rs 6,500 crore, Facebook Rs 2,500 crore and Rs 2,000 crore than others. Google and Facebook expect to close in 2018 with about 8,000 crore Rs and Rs 3,500 crore, respectively, with other players contributing about 3,000 crore, "said Amardeep Singh, Managing Director of Interactive Avenues, a digital organization owned by IPG Mediabrands.

According to industry estimates, a basic digital media campaign that reaches 1 billion impressions – the total number of views – costs around Rs 3 crore at the moment.

Organization leaders say that digital is now an important part of the media mix and given the rate of digital penetration and adoption, players are forced to raise prices.

"Today, you have between 400-500 million people on the internet because Jio has significantly reduced data prices." With increasing consumption and achievement, rates will also increase accordingly, "said Ashish Bhasin, Chief Executive Officer (Southern Asia) in the Dentsu Aegis network.

In addition to Snapchat, which has dropped the monthly active users (MAU) in India this year, all other platforms have made significant leaps.

According to industry consensus, YouTube reaches 250 million PPE, Facebook has 220 million, Instagram reaches about 68 million, and Twitter's MAUs have grown to 30.4 million.

And while repeating YouTube ad increases are being discussed in organizations, Singh believes that, given the scope of the platform, advertisers see value. "YouTube today reaches 120 million users a day with over 1 billion impressions, and few media vehicles can deliver that distance in a day," he said.

Alphabet executives told ET that YouTube sees some of the fastest rises in India and other Asian countries. "When Google purchased You-Tube with just $ 1.65 billion, it looked crazy at the moment, but today it feels like a theft. We've seen it grow by 7 hours of video content uploaded every minute so far 450 hours + of content "Everyone in Silicon Valley knows that Reliance Jio has shaken the Indian market and there is still an untapped opportunity to grab it," said two executives who are not authorized to speak to the media.

A spokesman for Google India said advertisers found value on the platform. "On YouTube, daily active users are up 100% from last year," the spokesman said.

Even platforms such as Facebook and Twitter have hikes rather than problems like bogus accounts and bots, according to sources. Twitter said it has cut 32% of the cost per Twitter commitment compared to last year, but the overall performance of the business per impression has improved.

A Twitter spokesman said improvement was due to turning the combination into higher-performing ad formats as well as higher clickthrough rates (CTRs).

Vivek Bhargava, CEO of DAN Performance Group, said these platforms have decompressed news feeds and schedules, and users have reached a critical mass to make sense to raise rates. "If you get FB, news news ads now cost more than 100% compared to the previous year," he said.

A Facebook spokesman, however, denied any price inflation for advertisers on the platform given the number, while maintaining social networking pricing "transparent" to every ad buyer. "Demand for advertisements continues to grow as more and more advertisers are on board as we expand the business, and the list is growing as we see more and more users on the platform," said the spokesman.