India's Flipkart Ads to offer third-party services to sellers
Flipkart Ads plans to become a $100m business by the end of the financial year 2018 by offering third-party solutions and digital products in addition to existing services for sellers and advertisers on its platform. The company is working with Google and YouTube to reach audiences through digital channels, with extra revenue expected from digital product bundles. Bengalaru-based Flipkart Ads is also planning to launch a financial products marketplace.
BENGALURU: Flipkart Ads , a division of the online marketplace, aims to be a $100-million business by the end of fiscal 2018, two years after acquiring global mobile ad network AdIQuity .The digital ad platform, which offers solutions for sellers on its online marketplace, now plans to push third-party solutions and digital products as well.It is tying up with Google and YouTube to target customers across digital channels. Selling bundled digital products is expected to generate additional revenue."In April 2016, we were focused on growing our business with brands and have now opened up for brands with which we have an indirect relationship. We are working with the BFSI industry and telcos to bundle products with purchases, monetising the intent to buy . At the end of the day we are the largest online transaction platform," said Prakash Sikaria, senior director of monetisation and new initiatives at Flipkart and head of Flipkart Ads.Flipkart, which will launch its financial products marketplace in a month or two, as reported by ET, is also likely to enter the digital-product space selling subscriptions and credit cards. "We will also launch extended warranties and device insurance, among others. Also, we have data on consumer credit profile, buying profile and the card heshe uses. During say a sale event when we are running promotions with bank partners, we can capture the intent of a customer to sell a particular bank's card as well. Going ahead, you could buy a Netflix subscription on Flipkart," said Sikaria.The size of the digital-marketing space in India was estimated to be Rs 11,645 crore in 2016, according to Forrester Research, with Google and Facebook dominating the space.As user searches move away from Google to ecommerce apps in consumer durables, phones and fashion, advertising on online marketplaces is an attractive proposition, industry experts said. "Online retailers are increasingly trying to increase revenues through online advertisements.The two biggest online retailers, Amazon and Alibaba , are getting a significant chunk of revenues from advertising," said Satish Meena, senior forecast analyst at Forrester Research India.With the launch of grocery and FMCG products on the cards, Flipkart Ads is looking to corner a share of FMCG advertisements. "FMCG companies pay for shelf space and on digital it will be a different play for visibility by the brands. We will also solve sampling at scale for new launches for our FMCG partners," added Sikaria.Consumer durables, along with ecommerce, FMCG, BFSI and Telecom account for 60% of the digital advertising space in India.He said that the ads business grew fourfold in the year ended March 2017 from a year earlier. The vertical, which has close to 100 members, anticipates similar growth in this financial year. "We plan to launch these initiatives ahead of the Big Billion Days sale, which will act as a booster," added Sikaria.