Advertising on national TV made cheaper
Oct 29 2012, 13:42 | By SME Mentor
One of the biggest challenges small business face is lack of advertising spend. Budgets simply cannot accommodate this 'luxury'. And if you're talking television advertising, not a chance! It was a challenge Mohali-based Janta Land Promoters Limited was grappling with, till they were told they could advertise on national TV - at a price that was less than even advertising on radio. Better still, to play on the relevance factor, their ads need not be broadcast across the country but targeted at potential customers only in Punjab, or even just Mohali.
This unbelievable proposal came from Amagi Media Labs, a Bangalore-based technology and media start-up that is challenging the very model of television advertising in India. Founded by three buddies, all of them techies, Amagi calls its innovation 'micro-targeting' or 'geographic targeting' of advertisements.
How It Works?
And, guess what? Amagi's software delivery platform seamlessly and automatically inserts its clients' ads into the national signal of a TV channel, without any manual intervention. This is achieved through agreements with TV channels, cable MSOs and DTH operators to install Amagi's software at their headends.
How it started?
The trio began working on a new technology platform in 2008 and managed to bring on board N S Raghavan, one of the founders of Infosys, as well as some media biggies as advisors. Next, they worked on ad inventories with four TV channels. The trio finally began commercial operations in 2010. Today, Amagi has tie-ups with 15 TV channels and cable operates across 65 cities in India, while its client list comprises an impressive 1,000 advertisers.
Considering the prohibitive cost of television advertising, Amagi needs vast sums of money at its disposal and has raised Rs 37.5 crore in funding to date. And it's paid handsome returns - the start-up has experienced 365-per cent growth over last year and is adding around 90 advertisers on a monthly basis, as the success of this model rests on scaling up.
Just how cost-effective is it for, say, a local optician or a fruit-seller to advertise on TV? "It costs only a fraction of the cost of advertising on national TV - in many cases 80 per cent less," reveals Srinivasan. He claims that for the cost of a quarter-page ad in a local newspaper, Amagi can offer as many as 20 TV ad slots per day, for a whole month.
Amagi sets 5-8 per cent of its total expenditure for a marketing budget, and uses it to advertise in the print and online media apart from social media and Google ads.
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