Dotcom Marketing in India

"A ten-minute drive through the city is enough to get feel of the money that is being pumped into the market.Unfortunately in Delhi, billboards have been banned and hence, dotcoms have to satisfy themselves with kiosks."

- Suhel Seth, chief executive officer, Equus Advertising.

"Indians still think that Net is e-mail. Consumers need to know about other applications of the Net."

- Neeraj Roy, CEO, Hungama.com, commenting on his unconventional promotional methods.

Advertising Blitz

In late 1999, Delhi's autorikshaws started sporting dotcom bumper stickers. During the same time, Mumbai's skyline was changing with dotcom hoardings. Full-page ads of the dotcoms could be seen in almost every leading newspaper. From print, to electronic and outdoor media, the dotcom companies flooded the market with high budget ads, contests, and interactive campaigns. During 1999-2000, Indiainfo¹ spent Rs 44 million² every month on advertisements in print and electronic media. Satyam Online³ planned to spend around Rs 200 million by the end of 2000. In early 2000, Indya.com⁴ released a front-page ad campaign in The Sunday Times of India⁵, in Delhi. According to market sources, the advertisement cost more than Rs 30 million.

During October 1999-January 2000, about Rs 500 million was spent on advertising by the dotcom companies (Refer Table 1 for the break-up). Analysts felt that in the next six months, another Rs 500 million would be spent.

While the average retailer spent about 5-8% of its total revenue on advertising and the average manufacturer 15-18%, dotcoms were spending more than 25% of its revenues on promotions. Analysts felt that the huge amount spent on advertising was to make a mark in the people's minds. Commented Suman Srivastava, Director, Euro-RSCG, "What most net companies have been doing so far is concentrating on traffic: their advertising has been geared towards generating trials."

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1] A site, which gives information on India, aimed at the NRIs.

2] In September 2002, Rs 48 equalled 1 US $.

3] An India-specific portal site of Satyam Infoway (subsidiary of Satyam Computers, a leading software company in India).

4] A site, which gives information on Indian politics, women, sports, cinema, music and travel.

5] A leading newspaper published by Bennett, Coleman and Co, Ltd., Mumbai.

Case Details

Case Code : ITSY006
Themes: e-Business
Case Length : 08 Pages
Period : 1990-2001
Organization : Equus Advertising, Hungama.com
Pub Date : 2002
Teaching Note : Available
Countries : India
Industry : Information Technology (Electronic Commerce)

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