After winning a $3 million funding from IDG Ventures, Dippak
Khurana, founder & CEO, Vserv talks about how the investment will
contribute to R&D expansion in emerging nations, how 3G has provided a
boost to m-advertising, and how In-App advertising is a very impactful ad
medium.
What is the scope of the In-App advertising
market globally?
Today a lot of people are downloading mobile applications
globally. According to a recent report from IDC, the estimated number of apps
downloaded in 2011 will be about 38 billion, which would reach 188 billion by
2015. While the majority of these are free apps, In-App advertising provides
the ability to ad-wrap these apps without touching the source code of these
apps, so that the developer does not have to put in any extra effort for the
ads. In-App ads are therefore displayed only at the start and end of the app in
full-screen mode – making it impactful, and also ensuring that a user’s In-App
experience is seamless, minus any ad within the app. This is in direct contrast
to other forms of mobile advertising, where the ad flashes throughout the usage
of the app.
Vserv recently received funding from IDG. What
is the main purpose of funding?
We raised $3 million from IDG, which is the first
investment for In-App mobile advertising in the APAC market. This is also the
first major investment in mobile advertising in this region after a gap of 3
years. We plan to use the fund to expand our sales and engineering team in
India and at the same time grow our operations in the international market. For
international operations, we are looking at South East Asia, Africa and the
Middle East. The same ad-format works across any app around the world, but we
now plan to penetrate the global market and reach out to local advertisers as
well, to promote more localized advertising. We are planning to increase our
Mumbai team from the current 15 members to 40, to further specialize in R&D
and operations. To enhance our business development and sales, we will be
hiring new teams in Indonesia and the UK.
How do you estimate the future growth of
browser-based advertising versus app-based?
Advertising on an internet site is similar to that of an
app download, however, the latter is much cleaner and richer than browser-based
advertising. The In-App advertising market is pegged to reach $900 million in
2011, according to IDC, which will grow to a $4.8 billion market by 2015. In a
market like India, with a huge base of approximately 50 million mobile internet
users, which is expected to reach over 200 million by 2015, the scope of mobile
advertising is steadily growing, with both browser-based and In-App advertising
growing side-by-side, due to equal usage of both. However, one advantage that
In-App advertisers have is the ability to access location-based data from the
app, which helps to access more information about a consumer and specifically
advertise to suit their needs.
Has 3G given a boost to mobile advertising
spend by operators?
All telecom carriers or device manufacturers have been
promoting their 3G business leveraging data services. In the last 1.5-2 years,
all advertising by telecom operators or manufacturers have been about data
browsing on the phone – so regular browsing on the phone is encouraged, thereby
increasing the scope of advertising on this medium. We have worked with all 3G
operators for 3G ads, and now regular digital advertisers are also cashing in
on mobile advertising, recognizing that it is the hottest medium of advertising
right now. Indeed, last year and this year has seen a doubling of mobile
advertising spend, mainly due to 3G. Therefore, one can safely say that the
impact of 3G is an infrastructure contribution to the industry, with new
devices and services and mobile advertising also getting to ride this space.
What is your growth strategy for the next 2-3
years?
In the next few years, we plan to go out and target
deeper penetration in international markets like India, South East Asia, and
Europe. Basically we are now focusing our attention on emerging nations where
there is a significant growth in the internet user base on mobiles, and where
there will thus be more scope for advertising. We will target both In-App and
browser-based mobile advertising equally, as we see both mediums being used
equally by mobile internet users.
By Beryl M
